I have a home insurance policy with Country Financial. They just sent a renewal for the next term and they raised our premium by 30% (AZ). We never had any claims – clean history. There was no explanation to why our premium was raised. Initially, I assumed it was a mistake. I contacted our agent, and after 3 emails he still did not give me any explanation. His first reply was an offer to reduce new premium by 20% if we add auto insurance.
I don’t like the way this agent responded to my inquiry and I don’t trust that this person will have our best interest in mind if anything ever happens, (hopefully, never). I dealt with him before - I asked to forward proof of guaranteed replacement to our bank who wanted to have our home insured at the purchase price. Honestly, his attitude raised some red flags at that time, but I thought that maybe he just had a bad day. Apparently, every day is a bad day for him .

I would like our file to be transferred to a different agent who works for Country. Preferably one, who works in a different office. I do not want to deal with our current agent anymore – there is absolutely no hope to fix our relationship. Is it possible to switch to a different office? How do I proceed? Who do I contact? Can I contact a new office and ask them to take my file over? Will a new agent get any % ? I understand no one wants to work for free. I just want to know why they raised the premium and I want someone at least to pretend that he/she cares about their clients. I cannot guarantee that I will stay with Country, (it depends on why the premium was raised and if a new agent will be better), but I want to give a company another chance before switching. I hope the agent I currently have is not the face of the company (though he did mention how successful he was… good for him, I guess )

I can get lower rate with different insurance companies. Liberty Mutual is one of them. The deal is Country is the only one offering true guaranteed replacement. I know some companies cap it at 20% or 25%, supposedly, Country does not (well, according to our agent). I do not know if they stand behind their policy and I never had any documents from them clearly outlining it, but I don’t think an insurance agent would lie about things like these.

As I was explained, guaranteed replacement is a policy which in case of a disaster will pay money to rebuild our house even if the final cost is more than a policy limit. I added "true" because some insurances apparently have guaranteed replacement option, but it is capped at 15-20-25% from the total policy limit.

Am I wrong?

Our current house is insured for ~450K (dwelling), we bought it for 440K, but it will cost way more to rebuilt it with all fancy things we have inside (cantera stone fireplaces, travertine floor, venetian plaster, etc) Honestly, to rebuild just a structure would cost less than 450K, but to rebuild it with everything inside + pool+ gazibo+ outdoor fireplace would come close to 600K. Also, our current auxiliary private structures coverage is ~45K, which is not enough to rebuild everything we have without guaranteed replacement. People who sold this house to us put a lot of money into it, but unfortunately for them the market was very bad at that time and they could not wait any longer. They lost money on it.

The only problem is nowhere in our policy breakdown Country Financial states that this policy is a guaranteed replacement policy. It was the same with our old house (we've been with CF for 4 years). If they're the last insurance company to offer this kind of policy, why they do not want to mention it anywhere on our annual invoice... I wish our agent could answer this question
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Originally Posted by Josh

What are you calling "true guaranteed replacement"?

wait, I can use the last email from our agent... that is what he calls guaranteed replacement policy

Quote: "With us you have no limit replacement cost. If your house burns all the way down we rebuild it no matter what the cost is. We are the only company that offers that. On your contents we will replace up to 4 times what you paid for it when it was new. So if you bought a used flat screen last year for $500 but it would have cost you $1,500 the year before if you bought it new then it burned in a fire and a new one this year it costs $6,000 we pay the $6000. We are the only company that does that. "

The replacement cost is a non-issue if you have the replacement cost estimated correctly. If you think you need $600k to rebuild, but $600k of coverage. The "guarantee"sounds like sloppy math to me. Just estimate it right to begin with and you won't have any surprises.

Good job for reading the policy. The four times replacement cost on the TV deal sounds fishy to me. Even if it's not, you're insuring it for more than you possibly need too. If liberty mutual is offering you a better deal and your like the agent more, that's a no brainer. Just explain everything to an agent the easy you did here and you should be in great shape. Shop it around a bit too and interview the agents so to speak. There are a lot of great agents that would love to earn your business.

A lot of companies offered guaranteed replacement cost policies years ago. Unfortunately there were some large scale fires that burned down hundreds of homes in a matter of days. When that happened, contractors jumped their rates, and really took advantage of the situation. I had several clients that the replacement cost jumped by over 120% overnight. That's when most companies discontinued "guaranteed replacement cost" language in the policy.

As far as changing agents, most captive companies like Country, State Farm, etc.. have internal processes in place already for a client to change agents. Call around or go meet with them and find someone you're comfortable with and ask them to handle it.

The replacement cost is a non-issue if you have the replacement cost estimated correctly. If you think you need $600k to rebuild, but $600k of coverage. The "guarantee"sounds like sloppy math to me. Just estimate it right to begin with and you won't have any surprises.

Good job for reading the policy. The four times replacement cost on the TV deal sounds fishy to me. Even if it's not, you're insuring it for more than you possibly need too. If liberty mutual is offering you a better deal and your like the agent more, that's a no brainer. Just explain everything to an agent the easy you did here and you should be in great shape. Shop it around a bit too and interview the agents so to speak. There are a lot of great agents that would love to earn your business.

Sorry for the delayed reply, for some reason I did not get notifications.

I am also a little bit skeptical about this "you bought it used, we pay for a new one even if it costs way more" statement. I would love to see reviews from people who ever managed to get this kind of coverage from CF after filing a claim. I certainly cannot find any reference supporting above mentioned statement in our insurance policy under "personal Property, Coverage D" or "Coverage EE Additional Replacement Cost". There is always a chance I missed it since the document is long and pretty boring I wonder how many people actually read it before there is a need to file a claim...

Quote: "Coverage EE Additional Replacement Cost"
If there is a loss to the building insured under Dwelling, Coverage C that exceeds the Coverage C limit of liability shown in the Declarations, "we" will increase the Coverage C limit of liability to equal the current replacement cost of the building. This coverage EE does not increase any coverage provided under Section 5, Additional Coverages, 3. Building Ordinance.
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Originally Posted by Biggdogg

A lot of companies offered guaranteed replacement cost policies years ago. Unfortunately there were some large scale fires that burned down hundreds of homes in a matter of days. When that happened, contractors jumped their rates, and really took advantage of the situation. I had several clients that the replacement cost jumped by over 120% overnight. That's when most companies discontinued "guaranteed replacement cost" language in the policy.

As far as changing agents, most captive companies like Country, State Farm, etc.. have internal processes in place already for a client to change agents. Call around or go meet with them and find someone you're comfortable with and ask them to handle it.

Maybe, I do not fully understand the true meaning of "guaranteed replacement cost" policy. According to your example it looks like they may guarantee to replace the structure in case the price goes up because of a disaster or other reasons, not necessarily replace our house when to begin with it cost more to build it than the total amount it is insured for (our case)... I think you need to have a JD degree in order to fully understand any policy declaration.

Well, so far I emailed the manager of the office and asked him to assign a different agent to my case or let me find another CF agent at a different office in our area. I also told that there was no guarantee I would stay with CF, and that I just wanted to get answers before making my decision. He assigned someone else within the office. I have not contacted that person yet. I still think that changing an agent within the same office is a little bit awkward, but hopefully I'm not the first one who did it.
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Originally Posted by Red Blooded American

You say your house is in AZ< but your flag says you are in Alabama.....

SO first of all, is this a rental house or a secondary house? Not many companies in AZ will write a secondary without the primary also.

House rates in AZ are starting to rise alot....

I kick Countrys rates everyday.

Well, my profile location states "Arizona", I have no idea why I have Alabama flag. It is our primary house. The only one
What insurance companies do you work with?

As was said, you really want to make sure your estimate of reconstruction cost (dwelling coverage) is as close to accurate as possible. There are many reasons for it, but the quote you posted is really the reason...

What will get you in almost any fire where the home is substantially damaged but not fully destroyed is the building ordinance coverage. Have an agent explain this in detail to you, but this is what covers you when the building code requires things that aren't required by the loss. For instance, there are many areas where if a home is 75% or more destroyed by a fire, you must demolish the entire house and rebuild. Insurance, under dwelling coverage will only pay for the 75% destroyed in the fire. Building ordinance coverage will pay for things required by the local building inspectors.

With a low dwelling coverage, you'll have a low building ordinance coverage, a low loss of use limit, etc. These can hurt pretty substantially.

Yes, guaranteed reconstruction cost is a thing of the past. Lots of reasons why, and its really not worth losing sleep over if the agent is doing their job.

On personal contents coverage, most true homeowners policies offer replacement cost coverage. His TV example is strange, but I understand it. Basically, you buy a couch 5 years ago, you don't want to have to replace it with a 5 year old couch, you want to replace it with a new one and have the money to do this.

In MY area, one of my carriers, REQUIRES us to use $125 per square foot of the house for the replacement cost, it doesnt matter what the cost estimater says, if it is lower than the $125, they will increase, they tell us they have not been able to rebuild a house in this area for less than that in the last 3 years, So In my agency, I require that at a MINIMUM.......

$125 per square foot times 2100 foot house =$262,5000, and I am confortable with this.

Sure we have lost a couple clients because they didnt want to use that figure, but I dont care, THAT is MY standard I require.

I "think" metlife still has the guarenteed replacement on the house, but it must meet certain qualifications, unless they finally did away with that here,

As was said, you really want to make sure your estimate of reconstruction cost (dwelling coverage) is as close to accurate as possible. There are many reasons for it, but the quote you posted is really the reason...

What will get you in almost any fire where the home is substantially damaged but not fully destroyed is the building ordinance coverage. Have an agent explain this in detail to you, but this is what covers you when the building code requires things that aren't required by the loss. For instance, there are many areas where if a home is 75% or more destroyed by a fire, you must demolish the entire house and rebuild. Insurance, under dwelling coverage will only pay for the 75% destroyed in the fire. Building ordinance coverage will pay for things required by the local building inspectors.

With a low dwelling coverage, you'll have a low building ordinance coverage, a low loss of use limit, etc. These can hurt pretty substantially.

Yes, guaranteed reconstruction cost is a thing of the past. Lots of reasons why, and its really not worth losing sleep over if the agent is doing their job.

On personal contents coverage, most true homeowners policies offer replacement cost coverage. His TV example is strange, but I understand it. Basically, you buy a couch 5 years ago, you don't want to have to replace it with a 5 year old couch, you want to replace it with a new one and have the money to do this.

Dan

I read about building ordinance a day ago. It is probably something many people do not hear about until they need to file a claim. If not for this sudden price jump I would not know about it either.

I guess, my current coverage is inadequate then. I can only imagine the price jump if I tell CF to insure this house for 550-600K

I do not fully understand what you meant when you said Quote "Yes, guaranteed reconstruction cost is a thing of the past. Lots of reasons why, and its really not worth losing sleep over if the agent is doing their job."
Are you trying to say that I should not stay with CF only because they still offer "additional replacement cost" while others do not? "if the agent is doing their job" = the agent offered a proper coverage from other home insurance companies (?)